A new dawn for Serbia as revitalized national airline takes to the skies

A new dawn broke for Serbia today, as the country’s revitalised national airline took to the skies, with new aircraft, new routes and new partnerships setting Air Serbia on the way to its goal of becoming the region’s leading carrier.

•Launch of Air Serbia is ‘good news for travellers, good news for the business and good news for Serbia’.•Proud day for new airline as first Air Serbia Airbus A319 enters fleet.•New route network, new aircraft and new partnerships to strengthen Serbia’s national carrier.

Air Serbia was
officially launched by Deputy Prime Minister AleksandarVučić, at an event for
senior Government figures and other VIPs, national and international media, and
airline employees.

The carrier’s
first Airbus A319, in the new Air Serbia livery of red, blue and white, and
boasting the new logo bearing a stylisedSerbian national coat of arms designed
by Serbian student Tamara Maksimovic, was unveiled by DPM Vučić at a glittering
ceremony at Belgrade Airport.

The launch was
welcomed by Air Serbia’s Chief Executive Officer as ‘good news for travellers,
good news for the business and good news for Serbia’. Dane Kondić said that new investment in Air
Serbia would deliver a customer-focused, commercial business which would
attract trade and tourism into the nation.

From 26
October, Air Serbia will launch a new route from its hub at Belgrade’s Nikola Tesla
International Airport to Abu Dhabi in the United Arab Emirates, with routes to
Banja Luka (Bosnia), Bucharest (Romania), Ljubljana (Slovenia) and Prague
(Czech Republic) to be launched by the end of 2013. These new flights add to the 29 destinations previously
served by the airline as part of its 2013 summer schedule.

Air Serbia
also plans to launch another seven new routes between January and April 2014,
in addition to rescheduling existing operations to optimise connections via its
hub in Belgrade. By June 2014, it will
have doubled frequencies and capacity, to serve43 destinations in 30 countries,
with 73,000 seats on more than 670 flights a week.

Eight Airbus
A319 and two A320 aircraft have been leased, the first part of a two-phase
fleet modernisation strategy which will give Air Serbia one of the most modern
and efficient fleets in the region. The first of these A319 aircraft, unveiled
today, has the new two-class configuration, with eight seats in Business Class
and 120 in Economy. Five more Airbus
A319s will be in service within the next two months, with another four in 2014.

As a member of
Etihad Airways’ ‘equity alliance’, which today includes another five partner
airlines (airberlin, Air Seychelles, Aer Lingus, Virgin Australia and Jet
Airways*, subject to regulatory approval), Air Serbia will also be able to
leverage revenue and cost benefits including new codesharing opportunities,
joint procurement, and shared training and staff development.

The Deputy
Prime Minister of Serbia, AleksandarVučić, said: "The launch of Air Serbia
marks an important new beginning for the airline industry in our country.

“Having a
strong and successful airline is vital for Serbia’s future economic development
and growth. Air Serbia will deliver
hundreds of millions of dollars a year into our economy.

“We have been
able to attract external investment, in addition to our own Government
commitment, to rebuild this airline into something special. We are bringing in the best technical skills,
business know-how and expertise to ensure Air Serbia evolves into a successful
airline.

“Our new
partner, Etihad Airways, is an airline that has grown faster than any other
full-service national airline in the last decade. Yet it has never lost sight of its commercial
mandate, tripling its profits last year.
We are looking forward to that rigor being applied to our national
airline.”

Air Serbia’s
first flight in its new livery will be from Belgrade to Abu Dhabi tomorrow (26
October).

MrVučić said
the Government-initiated program to right-size the company was an important
step in building a strong airline.

“We have had
to initiate short-term measures to improve the health of this business. Now, with new investment and with a strong business
partner, we can be sure of a positive future.

“In the
long-term, Air Serbia will provide exciting employment opportunities for many
young and enthusiastic Serbs, with fresh skills and talents to take the new
airline forward and contribute to strengthening our economy,” MrVučić said.

The airline
has already held recruitment days for new cabin crew, attracting more than 600
applicants in Belgrade earlier in October.

“The new Air
Serbia is good news for travellers, increasing route network choices regionally
and across the globe. It is good news
for the business, with new investment and a strict commercial mandate that will
secure the airline’s long-term future.
And it good news for the Serbian economy, helping to develop tourism and
trade routes over the long term,” he said.

He said that
work was already under way to implement changes which would improve the way the
airline operated.

“We are going
to be making changes to focus everything on the guest,” MrKondić said.

“That means
better aircraft and a guest focused team. It also means a network that takes
people where they want to go, with easy connections.

“While we are
committed to retaining and preserving our Serbian national heritage, everything
else must be reviewed in order to create a national carrier that is safe,
efficient, reliable, and delivers what our guests want.

“I am very
excited by the possibilities and challenges that this mandate presents and I
look forward to working to create a prosperous future for Air Serbia,” he said.

MrKondić also
welcomed the positive opportunities for Belgrade to develop its cargo
operation. “With a better route network,
and better connections with international partners, this can become a regional
hub for air freight,” he said.

In addition to
members of the Government, and many other national and international VIPs, the
launch event was attended by executives from Air Serbia’s minority shareholder
and partner Etihad Airways.

Etihad
Airways, the national airline of the United Arab Emirates, will make available
a US$ 40 million loan facility which will be converted into a 49 per cent
equity stake in January 2014, subject to regulatory approval. This will be
matched by an equal funding injection by the Government of Serbia.

Etihad
Airways and the Government of Serbia will also each provide a shareholder loan
of up to US$ 60 million to meet working capital requirements and support
network development for Air Serbia.

The President
and Chief Executive Officer of Etihad Airways, James Hogan, said: “We look for
partners who share our vision of best in class service, working to a commercial
mandate and delivering trade and tourism into their national economies.

“The team at
Air Serbia is professional, enthusiastic and committed. With the right focus, and working with Etihad
and our many strong partners, we believe Air Serbia can become a force to be
reckoned with in this region.”

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